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Argentina: tea production at its lowest in 10 years.

Argentina: Tea production at its lowest in 10 years

Drought and strikes caused a substantial decline in Argentine tea production during 1990/91. It is estimated that it will have dropped to its lowest level in the last 10 years and second lowest since 1973. "This season has been completely atypical," says Antonio Fernandez, president of Casa Fuentes, Argentina's largest tea producer and exporter, "An estimated 25,000 tons of tea is expected, down about 45% on the previous season's total."

Tea production in Argentina takes place in the northeast of the country and remains stable. Production is affected more by weather and the economy, both of which combined last season to cause the drop in production. Harvesting of the crop began later than usual on October 22nd because of late cold spells which delayed flushing. Flushing was again affected by a 60 day drought from the end of December to early March. Tea is not irrigated artificially in Argentina so there was no way of speeding up the growing process.

The drop in production was further aggravated by the economy in that small producers went on strike for two weeks in February demanding better prices for green leaf and improved credit facilities from the official banks. The actual area under cultivation to tea in Argentina is about 41,000 hectares of which roughly 85% is worked mostly by small growers who sell to any of the many processing plants. The price paid to the producer is related to the price the tea can be exported at.

Producers were unsuccessful in their bid for better prices as the economic situation did not allow for this. As a result many plantations were abandoned and all tea factories closed for the duration of the strikes. Once the strikes were over, plantations had to be pruned and a month was lost until they flushed.

"This is the first time there have been strikes of such proportions and whereas before there was always stock to compensate for low production, this year there is no stock," commented Fernandez. "Exports will be affected by the drop in production and this will be most noticeable in the coming months. Although export totals were up in April 1991, this was only because all of the previous seasons' stocks were exported".

After China, Argentina is the United States' major supplier of tea. According to statistics published by the Tea Association of the U.S.A., Argentina exported 17,117 tons to the United States in 1989; 18,379 tons in 1990 and 13,962 tons for the first four months of 1991 as opposed to 12,428 for the first four months of 1990. Black tea accounted for most of the U.S. imports while green tea imports made up 603 tons in 1989 and 1,734 tons in 1990.

Until the late 70's and early 80's all the tea consumed in Chile came from but because of border conflicts it changed its source of supply until recently when it became, once again, one of Argentina's main clients. It is usually second to the United States as an importer of Argentine tea but Argentine industry sources say that it will surpass the United States as the major importer of the 1990/91 crop probably taking around 9,500 tons

The United Kingdom is also fast regaining its former trading position lost during the South Atlantic (Falkland) war in 1982. 1990 saw the formal re-establishment of diplomatic and trade relations between Argentina and the United Kingdom. Before 1982, the U.K. was Argentina's principal European purchaser buying 5,493 tons in 1980. In 1989 England imported 3,965 tons of Argentine tea and in 1990, 2,536 tons.

The opening of Eastern European markets will mean that Poland will be importing around 3,000 tons of the 90/91 Argentine crop.

All Argentine tea is mechanically harvested. Whilst its quality is not comparable with other traditional producers, it is competitive pricewise. Being neutral in taste and with a good color, it blends well and is particularly favored for instant teas and iced tea.

Internal consumption of tea in Argentina is between 7,000 to 8,000 tons. Most tea-drinking Argentines prefer their tea in tea bags and give more importance to color than to aroma and taste. Tea takes a poor third place to coffee and yerba mate.

Coffee consumption is declining and is estimated to be down from 40,000 tons to 35,000 tons annually. Paraguay, Brazil and Colombia are the main suppliers of Argentine coffee.

The strongest competition for tea and coffee consumption comes from yerba mate, a tea-like beverage, which accounts for an annual consumption of 160,000 tons.

PHOTO : Typical tea plantation near Obera, Misiones Province, Argentina.
COPYRIGHT 1991 Lockwood Trade Journal Co., Inc.
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Author:Misdorp, Sheila
Publication:Tea & Coffee Trade Journal
Date:Sep 1, 1991
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